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[*1]


Decided on December 13, 2007
Supreme Court, Nassau County
Gregory W. Carman, Jr., Plaintiffs,
against
Diane Madey and "John Doe No.1 through John Doe #10", the last ten anems being fictitious and unknown to the Plaintiff, the person or parties intended being the person or parties, if any, having or claiming an interest in or lien upon the mortgage premises described in the complaint., Defendants.






14938-04
Counsel for Plaintiff Carman, Callahan & Ingham, LLP 266 Main Street Farmingdale, New York 11735 Counsel for Defendant
Jeffrey Levitt, Esq.
330 Broadway - Suite 2
Amityville, New York 11701
Leonard B. Austin, J.
Defendant in Action No. 2,[FN1] Diane Madey ("Madey") moves for leave to serve a second amended answer in that action. [*2]
BACKGROUND[FN2]
In 1986, Madey purchased an undeveloped parcel of land in Farmingdale, New York from Ronald and Alice Harmon. Madey planned to subdivide the property and build one family homes on the property.
Little was done to develop the property between 1986 and 1997.
In 1997, Gregory W. Carman, Jr. ("Carman"), the defendant in Action No. 1 and the plaintiff in Action No. 2, became involved in the development of the property. At that time, Madey and Carman incorporated Hardscrabble Acres Inc. ("Hardscrabble Acres") as their vehicle for the development of this property. Madey and Carman also entered into a Shareholders Agreement that set forth the parties' rights and obligations relating to the property and the project (the "1997 Agreement").
The property was subdivided into 4 separate lots. A one family home was to be constructed on each lot.
The venture faced delays and was constantly behind in its construction schedule. These and other problems increased the cost of construction and rendered the financing obtained for the project insufficient.
In 2001, Madey and Carman entered into an agreement relating to the development of the property (the "2001 Agreement"). The 2001 Agreement superceded and replaced The 1997 Agreement. Pursuant to the 2001 Agreement, Madey and Carman each acquired one lot. Hardscrabble Acres was to develop the other two lots. The lot Madey acquired was designated at 10 Marie Thomas Court.
Carman provided money to Madey that she was going to use to build the house on the lot she acquired pursuant to the 2001 Agreement. Carman took back a mortgage on 10 Marie Thomas Court as security for the repayment of the money he had loaned to Madey.
Action No. 1 was commenced by Madey seeking damages sustained by Madey, Hardscrabble Acres, Inc. and Heritage Homes at Bethpage Park Estates, Inc. arising out of Carman's alleged breaches of the 1997 and 2001 Agreements, breach of fiduciary duty and legal malpractice. This Court's December 6, 2006 order granted Carman summary judgment dismissing the complaint.
Madey moved to renew and reargue. Her application was denied by this Court's June 29, 2007 order.
Action No. 2 is brought by Carman to foreclose on the mortgage made by Madey to him. Carman alleges he loaned Madey $125,000 which was secured by the aforementioned mortgage. When Madey failed to repay the loan on the due date, Carman commenced this action to foreclose.
At some point, Carman served an amended complaint in Action No. 2 which Madey answered.
Thereafter, Madey moved for summary judgment dismissing Action No. 2 or, alternatively, for leave to have her answer deemed amended to assert that the underlying loan [*3]from Carman is usurious. By order dated July 23, 2007, Madey's motion for summary judgment dismissing the Amended Complaint in Action No.2 and for leave to have her answer deemed amended to assert the affirmative defense of usury was denied.
Madey now moves for leave to serve a second amended answer.
Madey's answer to the amended complaint alleges two affirmative defenses and five counterclaims. The five counterclaims are also designated as Madey's third, fourth, fifth, sixth and seventh affirmative defenses.
The proposed second amended answer contains four affirmative defenses and seven counterclaims. The seven counterclaims are also designated as Madey's fifth, sixth, seventh, eighth, ninth, tenth and eleventh affirmative defenses.
Madey seeks to add two affirmative defenses denominated as the third and fourth affirmative defenses and two affirmative defenses/counterclaims designated as the fifth affirmative defense/first counterclaim and eleventh affirmative defense/seventh counterclaim in the proposed second amended answer.
DISCUSSION
A.Amended Pleadings - Standard
"Leave to serve amended pleadings shall be freely given' absent prejudice and surprise resulting from the delay (CPLR 3025[b]; see Fahey v. County of Ontario, 44 NY2d 934; Faracy v. McGraw Edison Corp., 229 AD2d 463)". Northbay Construction Co., Inc. v. Bauco Construction Corp., 275 AD2d 310, 311 (2nd Dept. 2000). See also, Nikac v. Rujak, 276 AD2d 443 (2nd Dept. 2000); and Goldstein v. St. John's Episcopal Hosp., 267 AD2d 426 (2nd Dept. 1999).
The determination of whether to deny or permit an amendment is entrusted to the sound discretion of the court. See, Liendo v. Long Island Jewish Med. Ctr., 273 AD2d 445 (2nd Dept. 2000); and Henderson v. Gulati, 270 AD2d 308 (2nd Dept. 2000)
The party seeking leave to serve an amended pleading must make an evidentiary showing that the proposed amendment has merit. Ruffing v. Union Carbide Corp., 308 AD2d 526 (2nd Dept. 2003); Mohan v. Hollander, 303 AD2d 473 (2nd Dept. 2003); and Curran v. Auto Lab Service Center, Inc., 280 AD2d 636 (2nd Dept. 2001).
Mere lateness of the proposed amendment is not a barrier to the service of an amended pleading. The party opposing the proposed amendment must demonstrate that significant prejudice will result if the party is permitted to serve an amended pleading. Edenwald Contracting Co., Inc v. City of New York, 60 NY2d 957 (1983); and O'Neal v. Cohen, 186 AD2d 639 (2nd Dept. 1992). Prejudice occurs when the party opposing the amendment has been "...hindered in the preparation of their case or prevented from demonstrating the merits of their position." First National Bank of Hudson Valley v. Schantz, 253 AD2d 735, 736 (2nd Dept. 1998).
To defeat a motion for leave to serve an amended pleading, the party opposing the amendment must demonstrate... "some special right lost in the interim, some change of position or some significant trouble or expense that could have been avoided had the original pleading contained what the amended one now wants to add." Siegel, New York Practice 4th

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